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291. The Emergence of China in the Middle East

Author:
James Chen
Publication Date:
01-2012
Content Type:
Working Paper
Abstract:
During the 9th century, Arab traders regularly plied lucrative maritime routes that connected the Persian Gulf to southern China by way of the Indian Ocean. This commercial activity, which mostly involved jade, silk, and other luxury goods, went on for centuries and became part of what is now known as the Silk Road. In some ways, the world is now witnessing a restoration of that ancient trading relationship between two civilizations—except that oil and consumer goods have replaced jade and silk.
Topic:
Foreign Policy, International Trade and Finance, Markets, and Foreign Direct Investment
Political Geography:
China, Middle East, and Arabia

292. Credit-constrained in Risky Activities? The Determinants of the Capital Stocks of Micro and Small Firms in Western Africa

Author:
Jann Lay, Michael Grimm, and Simon Lange
Publication Date:
01-2012
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Micro and small enterprises (MSEs) in developing countries are typically considered to be severely credit constrained. Additionally, high business risks may partly explain why the capital stocks of MSEs remain low. This article analyzes the determinants of the capital stocks of MSEs in poor economies focusing on credit constraints and risk. The analysis is based on a unique, albeit cross-sectional but backward-looking, micro data set on MSEs covering the economic capitals of seven West-African countries. The main result is that capital market imperfections indeed seem to explain an important part of the variation in capital stocks in the early lifetime of MSEs. Furthermore, the analyses show that risk plays a key role in capital accumulation. Risk-averse individuals seem to adjust their initially low capital stocks upwards when enterprises grow older. MSEs in risky activities owned by wealthy individuals even seem to over-invest when they start their business and subsequently adjust capital stocks downwards. As other firms simultaneously suffer from capital shortages, such behaviour may imply large inefficiencies.
Topic:
Development, Economics, International Trade and Finance, Markets, and Foreign Direct Investment
Political Geography:
West Africa

293. Towards the successful implementation of the updated OECD Guidelines for Multinational Enterprises

Author:
Tadahiro Asami
Publication Date:
01-2012
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
The Business and Industry Advisory Committee to the OECD (BIAC) has accepted the updated OECD Guidelines for Multinational Enterprises (Guidelines), adopted on May 25, 2011 after a series of negotiations and consultations among members of the Organisation for Economic Cooperation and Development (OECD), adhering governments, BIAC, the Trade Union Advisory Committee to the OECD, and OECD Watch, an international network of civil society organizations. The Guidelines are the most comprehensive government-endorsed code of responsible business conduct. The Update upheld the voluntary and non-legally binding character of the Guidelines, and while the new text introduces important new elements, the Update is very carefully formulated and its changes are accompanied by extensive conditionalities.
Topic:
Development, Economics, International Cooperation, International Trade and Finance, Markets, and Foreign Direct Investment

294. Financial Reform after the Crisis: An Early Assessment

Author:
Nicolas Véron
Publication Date:
01-2012
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
This paper aims to take stock of global efforts towards financial reform since the start of the financial crisis in 2007–08, and to provide a synthetic (if simplified) picture of their status as of January 2012. Underlying dynamics are described and analyzed both at the global level (particularly G-20, IMF, and FSB) and in individual jurisdictions, as well as the impact the crisis has had on these regions. The possible next steps of financial reform are then reviewed, including: the ongoing crisis management in Europe, the new emphasis on macroprudential approaches, the challenges posed by globally integrated financial firms, the implementation of harmonized global standards, and the links between financial systems and growth.
Topic:
Economics, International Trade and Finance, Markets, Global Recession, and Financial Crisis
Political Geography:
Europe

295. Another Shot at Protection by Stealth: Using the Tax Law to Penalize Foreign Insurance Companies

Author:
Gary Clyde Hufbauer
Publication Date:
01-2012
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
The United States suffers from a severe self-inflicted wound. Together, federal and state governments impose almost the highest corporate tax rate found among advanced countries, 39 percent. Only Japan is fractionally higher. The high US rate has adverse consequences—lost investment, lost jobs, and less innovation—and goes a long way to explain slipping US competitiveness in the world economy.
Topic:
Economics, Industrial Policy, International Trade and Finance, and Markets
Political Geography:
United States and Japan

296. Worldwide Cost of Living 2012

Publication Date:
02-2012
Content Type:
Working Paper
Abstract:
For the first time in at least two decades of reporting the worldwide cost of living survey Zurich sits atop the ranking as the world's most expensive city. An index swing of 34 percentage points pushed the Swiss city up 4 places compared to last year to overtake Tokyo which remains in 2nd place. Geneva, the other Swiss city surveyed saw a 30 percentage point rise in the cost of living to move up six places into joint third alongside Osaka.
Topic:
International Relations, Demographics, Economics, Markets, and Urbanization
Political Geography:
Tokyo

297. Pharmaceutical Price Regulation: Macro-Level Evidence from China between 1997 and 2008

Author:
Qiong Zhang, Binzhen Wu, and Xue Qiao
Publication Date:
01-2012
Content Type:
Working Paper
Institution:
Walter H. Shorenstein Asia-Pacific Research Center
Abstract:
This paper uses macro-level data between 1997 and 2008 to evaluate the effects of China's pharmaceutical price regulations. We find that these regulations had short-run effects on medicine price indexes, reducing them by less than 0.5 percentage points. The effects could have been slightly reinforced when these regulations were imposed on more medicines. However, these regulations failed to reduce household health expenditures and the average profitability of the pharmaceutical industry, and firms on the break-even edge were worse off. Finally, although these regulations have no significant effects on the price of substitutes or complements for medicines, they increased expensive medicine imports.
Topic:
Economics, Health, Human Welfare, Industrial Policy, International Trade and Finance, and Markets
Political Geography:
China

298. Still a Better Deal: Private Investment vs. Social Security

Author:
Michael Tanner
Publication Date:
02-2012
Content Type:
Working Paper
Institution:
The Cato Institute
Abstract:
Opponents of allowing younger workers to privately invest a portion of their Social Security taxes through personal accounts have long pointed to the supposed riskiness of private investment. The volatility of private capital markets over the past several years, and especially recent declines in the stock market, have seemed to bolster their argument.
Topic:
Economics, International Trade and Finance, Markets, and Financial Crisis
Political Geography:
United States

299. Can Producer Associations Make Agriculture Sustainable? Evidence from Farmer Development Centers in India

Author:
Raj M. Desai and Shareen Joshi
Publication Date:
01-2012
Content Type:
Working Paper
Institution:
The Brookings Institution
Abstract:
This paper evaluates the impact of the Self- Employed Women's Association's (SEWA) farmer development center (FDC) initiative across five farming districts in Gujarat, India. The initiative provided a mix of training, information provisions, access to farming inputs, risk mitigation, and output. Controlling for a range of individual-specific, household, and village level factors, we find that SEWA membership primarily raised awareness of available opportunities among its participants, linked women to the financial sector and to diversified employment opportunities, including non-farm work. There is also evidence that the program's impact varied depending on the participants' socio-economic background. The poorest members experienced higher farm and non-farm incomes, increased food consumption, improved household and farm productivity, more self-employment opportunities, a greater likelihood of opening a bank account, higher crop harvests, and greater food security. These estimates suggest that the major comparative advantage of FDCs lies in improving access to credit and in expanding access to useful information.
Topic:
Agriculture, Development, Economics, International Trade and Finance, and Markets
Political Geography:
India and Gujarat

300. Africa: open for business The potential, challenges and risks

Publication Date:
02-2012
Content Type:
Working Paper
Abstract:
Africa is drawing increasing attention, not only from the perspective of businesses based in China and Europe, but also from operators in Africa itself. In particular, closer economic ties between Africa and China have been covered extensively by the media recently—with fairly mixed reviews. This paper highlights the potential, challenges and risks for doing business in Africa over the next few years.
Topic:
Development, International Trade and Finance, Markets, Foreign Aid, and Foreign Direct Investment
Political Geography:
Africa, China, and Europe